That's a great perspective to have on what it takes to make even the simplest things, like a pencil. Unfortunately, (but not unsurprising), Friedman makes the grand claim that capitalism crates harmony in the world at the end of the video, but besides that, it was a interesting and quick watch. Thanks for sharing it.
It depends on what someone means by “capitalism”. Some people use a definition which is more specific than just “trade”. So for example we tend to see firms owned by individuals who are materially separate from most of the workers, and some people see this phenomenon as part of what we ultimately call “capitalism”. Control of firms by a small number of people can lead to choices which are good for the leadership but bad for most of the workers. If you have a larger economy made up of firms with this structure, then you can see a great number of choices made that benefit a small number of people to the detriment of a large number of people. Essentially, this arrangement has a tendency to enrich a minority, concentrating capital in a way that perpetuates this cycle. Eventually you end up with a whole lot of people living in desperation barely able to survive while a small number of people are unfathomably wealthy.
One might ask if such an arrangement is good for society if most people are left struggling to survive.
However this is all based on a rhetorical question: does “capitalism” the word include this arrangement of firms? Is unrestricted free trade likely to lead to this arrangement of firms? Would a different structure of firms, like cooperative ownership, alleviate some of those problems? You could still have “trade” in an economy of cooperatives. But would that still be “capitalism” or would this be considered something else?
People are divided on whether it should be called something else. But a lot of people who think we should “move beyond capitalism” do not want to eliminate free trade, just the societal norm where most firms are controlled by a small number of people.
I have never met two people who can agree on how this would actually work. Just some basic questions:
Is there still government controlled currency and interest rate? If not, how is the money supply in the economy managed? Am I allowed to print my own currency?
Is there intellectual property?
If there are no trademarks, there is no such thing as counterfeit goods, so I can produce a laptop and call it macbook.
Does that mean Cartels are allowed? Is market manipulation allowed? Presumably unrestricted trade means I can run pyramid schemes and call them banks?
What happens if the seller lied about the product?
Is there adverse possession of property and planning permission? If not, can I dig down or build up as far as I want? What if I block sunlight to your solar panels on purpose?
Can I sell my kidney? If yes, can I trade in someome else's kidneys?
Can I give out loans with crazy interest rates? If yes, you just legalised debt bondage, a form of slavery.
Is there bancrupsy?
Are there air rights and rights over electromagnetic spectrum?
Any conceivable set of anwers to these question amount to rules and regulation. You can't actually function in anarchy
I didn’t read it as an advocation for anarchy. In my mind, they were saying we are still in feudalism and serfs type system when it comes to corporations. The rulers of these corporations can make arbitrary decisions and rule their “kingdoms,” exiling anyone who shakes the boat too hard.
They were asking what comes next and what would that look like.
Worth noting that I am not advocating for unrestricted free trade. But the person I was responding to seems to be pro-capitalism so when I make my arguments for a post-capitalist future (depending on your definition of capitalism, as I mention in my above comment), I use terms that a pro-capitalist can understand. That is, I couch my language in real world effects of the arrangement of capital, and advocate for a world where firms are managed by collectives. In familiar company I identify as a libertarian communist. For anyone spooked by this, I am referring to a voluntary society where people who agree that collective management is best work with others who feel the same way. And yes this can be accomplished in the current society. As such a plan would involve coordination with others, I necessarily must discuss it with others, so here I am.
To the person I am responding to: I would suggest listening to some lectures from the Mises Institute on youtube. They aren't my people, but they have some nice theory if you want to know what they think. I do think that if you want to have a voluntary society, it is worth understanding Austrian economic theory.
Thanks for the comment. I really don't know anything about these kinds of discussions. I tend to not know what people mean when they say they're anti-capitalist on Mastodon, but this gives me a clue. Interesting to read!
You say you'd refer to what you're talking about as "libertarian communist." I'm not worried about this term, I'm just curious! Do you know of a resource that lays out and summarizes some of these ideas? I don't expect you to teach me them, but it sounds like you might know where to even begin. I don't even know what terms to search for right now!
“Anarchism” is also a term often used to describe libertarian communism. The term has been co-opted by people who are trying to describe chaos, but the term anarchism has a rich history, explained here:
I was going to respond to you point by point, but I realised halfway through you might not read it anyway, so I will focus on two misunderstandings you seem to hold, that affect all of your questions:
First, this is a very revealing question:
> Can I give out loans with crazy interest rates? If yes, you just legalised debt bondage, a form of slavery.
For a loan to turn into slavery, you presuppose a system that can by threat of violence convert debt to forced work. In a true anarchy, there's just no way to go from debt to forced work.
Under anarchy, debt is a voluntary cooperative agreement between two people where they think one can use the pooled resources of both more effectively than they could alone, in exchange for a cut of the fruit of the labour.
Both parties enter into this agreement fully aware that those fruit may never materialise and, critically, that there is no way to employ violence to ascertain that they do.
However, a community is not made out of two people. If one person routinely dishonours their loan agreements, they will find it hard to cooperate with other vital functions of society, for example to acquire food or tools or utilities or communication.
This leads into your second misunderstanding. You seem to imagine that a person under no regulation can "build up as far as I want".
As an individual, there is only so far up you can build. Realistically, you can personally forage material and build for at most 10 hours per day and then you need to forage food and get rest. As an individual, you cannot use machinery because you cannot, as an individual, get the petroleum to drive the machinery.
If you are going to build anything of consequence, you need to enlist the help of other people. In a capitalist society, this is somewhat easy: you can convert capital into tall buildings, regardless of what the local community wants. This is why capitalism needs regulation, to account for what the local community wants.
In an anarchist organisation, you will find it really hard to recruit builders that will voluntarily ruin their own local environment.
This theme continues throughout your comment:
- if you block my solar panels and the community disagrees with your reasoning, you might find it hard to live comfortably in that community because other people will be less inclined to help you acquire your creature comforts.
- if you start a pyramid scheme and call it a bank, the community bank rating association will give it a shitty score.
- if you repeatedly lie about the items you are selling, you will get a bad marketplace rating too -- just like what happens already in less regulated markets today.
- free banking was never the disaster currency monopolists would like it to be. Sure, it had its fuckups, but so does the current system. The problems may even have been more frequent, but also of a much lower magnitude.
It's well-known that unregulated capitalism leads to monopolies. In the past, the corporations literally raised armies and slaughtered smaller competitors.
So, monoplies (and feudalism, and dictatorships, and pretty much any centralization of power) are bad.
The obvious solution is to have strong antitrust regulation. That leads to regulatory capture and corruption. I'm not sure what happens next. We haven't had a democracy that was also a superpower collapse yet. Rome comes to mind, but they didn't have nukes and a global for-profit surveillance network propping them up.
Anyway, we really need to start enforcing antitrust law, and get back to de facto "majority rules" in the US.
I'd like a source for the first. Given no other information, the best estimate of the energy footprint of the manufacturing process for an item is its shelf price.
This works particularly well for cheap items, where raw material costs (which are mostly just the energy cost of mining and refining) and shipping costs dominate. Usually, things are shipped around so they can be processed in the most specialized/energy efficient facility available. For small items, the pollution associated with shipping via ocean freight is miniscule.
As for the second point, the current system is fragile, but compared to what? If I had to pick a pandemic to live through at any point in time so far, covid would be my first choice.
> the best estimate of the energy footprint of the manufacturing process for an item is its shelf price.
Not really? This depends on the relative price of the energy of delivery and the value of the other parts of the good. And energy is so cheap, we seem pretty comfortable wasting it.
I've noticed where I live in California most markets sell this kind of jam made in France called Bonne Maman. Not even fancy markets, but the big local supermarket chains. What is weird about this is that California is a huge producer of fruits. I can buy jam made in a nearby town at one of the fancier markets near here, but the big supermarket chain buys jam from France.
This seems like a senseless waste of energy. I refuse to buy the jam from France because it's so wasteful. There's a lot of perverse incentives in our economy, and price cannot optimize for every variable. Capitalism is not as resource efficient as some basic theories would purport it to be.
Search the page for "the climate impact of food miles" to jump to a graph that breaks down the source of CO2 emissions for various types of food. (The caption also references the source article from Science 2018.) Of the things there, the jam is probably closest to coffee or chocolate.
I'd be more worried about Bonne Maman's packaging's CO2 footprint. However, our kitchen floor is concrete, and the kids break a glass every month or so. We stopped buying glasses for them and use the (extremely low quality glass) jam jars instead. When they get older, we'll look for jam that comes in larger containers.
Ask Germany how trade with Russia is working out currently.
It’s all comparative advantage and win-win scenarios until you find yourself dependent on despicable foes for your food, energy, and basic necessities.
The vulnerability created in those situations may actually encourage bad actors to declare war opportunistically.
It's an insightful video, however it doesn't mention the possibility that workers can be exploited through unfair wages, work hours or conditions, so that the various parts of the pencil industry can cut higher margins. Choosing an economic system vs another isn't enough.
Capitalism is an obsession over capital at the expense of everything else. If going to war serves the interests of capital, then it will be done without any questions.
